Ask an expert: This reader has noticed the catches that come with high
interest accounts. Can he get away with setting up a minimal direct debit?

I have noticed that most banks demand that customers fulfil several criteria to qualify for their current account benefits. Lloyds, for example, requires at least two direct debits to be set up in order to qualify for their 4pc current account. Are there any minimums to this requirement? Could I qualify with a £1 direct debit?

JM, via email

Given the dismal savings rates currently on offer, it's no wonder customers are being drawn towards high interest current accounts. However, while some pay up to 5pc interest, most of these attractive offerings come with catches, like setting up direct debits or paying in large monthly sums.

In terms of setting up direct debits - none of the top paying accounts ask for a minimum value.

Santander, Lloyds, M&S, Clydesdale Bank and Halifax are such examples. Their current accounts all require at least two active direct debits to be linked to the account, but do not suggest an amount.

Therefore, you could in theory set up two direct debits and the amount could be minimal.

However, in the case of reward accounts, like Santander’s 123 current account*, this could be in your detriment as you will not be making the most of the bank's cashback feature.

Santander pays 1pc cashback on water and council tax bills, plus 1pc on the first £1,000 on Santander mortgage payments. It then pays a further 2pc back on gas and electricity bills, and 3pc on communication outgoings, like phone, broadband and TV packages.

The fee for this account recently increased from £2 a month to £5 which meant for some customers, the account is no longer worthwhile. However, for others who utilise the features to the maximum, it still remains a top-payer. For more information, read: who should ditch the Santander 123 current account?. To make the most of the cashback and cover the fee, it would make sense to make all relevant direct debits from this account.

Direct debits are just one requirement of high interest current accounts – there are often further catches. Some account demand a minimum monthly pay in and others only offer the top interest rate for the first 12 months.

Here are some examples of accounts that pay high interest - and the criteria customers must fulfil.

With such dismal savings rates available, it's no surprise that customers are looking for alternatives. The average interest bearing account pays just 0.81pc - and many current accounts don't offer any interest.

But Tom Adams, from SavingsChampion.co.uk, says customers should take into account the criteria of the above current accounts when calculating their overall return, especially if they have to pay a monthly fee.